Generation “Y” will challenge the business world traditions

Hadi Kardoyo ,  Jakarta   |  Fri, 10/03/2008 7:35 AM  |  Opinion

This article is based on ideas discussed at the graduation ceremony of the Faculty of Business, Economics and Law at the University of Queensland, Australia in July, 2008, when Professor Stephen King-He, a Commissioner of the Australian Competition and Consumer Commission (ACCC), gave a speech on the story of “Y”.

He explained to the assembled graduates that they are part of what some people now called “Generation Y”.

Prof. King described that many of todays’ graduates would have been born between 1982 and 1994. This generation, at least according to Wikipedia, is referred as “Generation Y” or “the millennium generation”. He also mentioned how Australian newspapers have looked at Generation Y as a kind of totally different species and how this generation presents a challenge to traditional business concepts.

There are a number of reasons why Generation Y is worrying traditional business.

First, they understand technology and technological change.

Second, they have social concerns about broader issues such as poverty and environmental issues.

Third, they believe that there is a boundary to be maintained between life and work.

Generation Y is worrying traditional business because they do things which were simply impossible ten years ago. They communicate through mobile phones, SMS and many of them have face book accounts and use the internet as a source of information.

This generation is worrying businessmen and politicians because as a group they care about the world. When buying a product, they think not only about the product itself but where it comes from. Concepts such as fair trade, corporate social responsibility and the environment have been driven by this generation.

Business activities today would also have to accommodate the Generation Y belief on how to create balance between work and leisure activities, as it is believed there is a correlation between this balance and the rate of productivity.

The same phenomenon that Prof. King described for Australia also can be found in big cities in Indonesia, especially Jakarta. Many people have their own mobile phones. Even tukang ojek (motor cycle taxis) get calls to pick up customers. This is very different compared to what happened previously. Previously mobile phones were relatively expensive and not everybody was able to buy and access a mobile phone as a communication tool.

“So what does this mean?” The answer is that the growing application of information and communication technologies (ICTs) has contributed to changes in many aspects of economic activity. Applications of these technologies have contributed to the growth of activities which have never happened before.

Doing business through the internet, for example, has been widely adopted as a new pattern of commerce in industrialized countries and even in Indonesia.

Many people, in more advanced economies, for example, are used to checking eBay, Amazon.com, and many other websites to get anything they need which might be more difficult to get in the traditional marketplace.

Many people no longer go to the post office to pay their electricity and telephone bills. They just open an internet banking account, click the buttons and that’s it.

For example, people who like playing tennis can easily get hold of specialist tennis rackets which were very popular in the era of Pete “Pistol” Sampras and Marat “Scud” Safin.
You just need to open the site, made sure anything is okay, click the “buy it now” button, pay with Paypal and the following week you get the item delivered to your address.

It may be a bit difficult to find a specific item here in Indonesia, even in Jakarta. But we are starting to have the same facilities and to do the same things as people elsewhere. Almost everybody here in Indonesia has his own mobile phone. It is a good start and gives us the hope that this will contribute to the growth of our productivity.

Take a good example, when we are out of fresh water and LPG, we only need to text a message to our supplier. A gallon of fresh water and a 15-kilogram canister of LPG will be speedily received at our home address.

“Someone may have questions about this”; “how can I?”, “Is there any explanation why?” In the past, service is associated with the characteristic of co-terminality of service.

It means we had to consume the service product at the same time it was produced. From this point of view, service is perishable and cannot be stored.

Why ICTs? ICTs allow the increased tradability of service activities, particularly those which have been constrained by the geographical or time proximity of production and consumption. The capability of ICTs to create new forms of service in a space or time/storage dimension, will enhance the separation of production from consumption.

So what should we do to address these issues? Public support to improve market openness and a high degree of competition in the domestic market is considered the most effective way of enabling the service sectors’ elements to interact and generate more differentiation of services activities.

To date, Indonesia is still struggling with the digital divide both within and between peer countries. The existing state of ICT infrastructure has become the main impeding factor for the growth of the use of ICTs.

In dealing with this barrier to growth, the government should be able to implement projects to connect all major islands, as this will accelerate the process of bridging the digital divide within the country.

The Indonesian government also needs to empower market competition and private sector competition to contribute to the provision of ICT links within the main infrastructure such as fixed line and mobile phone infrastructure, backbone internet connections and any other alternative technology choices for internet infrastructure such as Wi-Fi and WIMAX, to connect the areas that lack network infrastructure and increase connectivity. The more widely available ICT infrastructure becomes, the easier and the cheaper internet access will be.

The writer is a researcher in the Centre for Science and Technology Development Studies. He is an alumni of the University of Queensland and can be reached at hadikardoyo@yahoo.com This is his personal opinion.

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